# Economics of retiring baby boomers **URL:** \ **Category:** Factual Questions\ **Created:** [December 20, 2014, 6:07pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758 "2014-12-20T18:07:29Z")\ **Posts on this page:** 6\ **Page:** 4
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 24, 2014, 9:29pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758/61 "2014-12-24T21:29:36Z")
> [@md2000](#): > > My fear is that the frantic search for profits is driving ever-worsening feedback cycles. the 2008 crap mortgage crash was worse than the 200 internet crash, which was worse than the S&L crash, etc. If your fund tanks to 2/3 of its previous value, but you still have to pull $X out just to live, that puts a bigger dent in your fund than if it is still sitting in a corner untouched, growing for future draw-down. A multi-year down cycle like 2008 onward can seriously injure a fund. I’ve also seen advise to pull money out of more volatile investments in good times, to lock in gains, which I assume means taking money out of less volatile investments in bad times. My point was that you don’t want to change your allocation all that much upon or close to retirement. More stable, income producing equities less, a preponderance of bonds no. 2008 was great for me, btw. Didn’t dump anything, bought more, and I’m now reaping the benefit. Tougher when you do have to sell stuff to live, though. > [@](#): > > the scary part is that when people suddenly realize that they should be saving, it is usually too late. Somewhere between 30 and 40 they start to realize 65 is in striking distance, they’ve lost 10 to 20 years of savings and growth. That’s true. And as people marry later and get established later they wake up later too. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [December 24, 2014, 9:45pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758/62 "2014-12-24T21:45:29Z")
> [@Voyager](#): > > (snip)2008 was great for me, btw. Didn’t dump anything, bought more, and I’m now reaping the benefit. Tougher when you do have to sell stuff to live, though.(snip) 2008 was a terrible year for me. Between January 1, 2008 and January 1 2009 my retirement account lost 32.7% of its value, and that’s with me shoveling money in with both hands, actually money in excess of the tax free maximum so I had to put in after tax dollars. 2009, now that was a good year, up 50% in 2009 and 25% in 2010, so not too bad overall. Jack Bogle says it’s not timing the market, it’s time in the market. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 24, 2014, 9:46pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758/63 "2014-12-24T21:46:31Z")
> [@Ruken](#): > > I’m guessing you can make an argument without an appeal to authority. Appeal to authority? No, just a note that someone aged 35 can’t really imagine how he or she will feel at 65. I sure couldn’t. Sure there are people who want to work forever, but there are also lots of people - many of them my classmates - who want to and did retire early. > [@](#): > > I am interested in this topic and would like to read the academic literature. Please cite. I can’t imagine what such a study would be like, but I’d suggest looking at classes offered in, say, computer science in 1975 and 2015. Much of what is taught today didn’t exist back then. Even those of us who keep up in specific areas can’t keep up on everything - not enough hours in the day. And internal training has been cut way back over the last 30 years. This malady afflicts not just those of us in industry but also people in academia. I’m quite familiar with what is taught for the basic class in my field, usually at the Masters level. Very very often it is 20 years out of date, the exception being the classes taught by people who just moved from industry to academia. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [December 24, 2014, 9:49pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758/64 "2014-12-24T21:49:15Z")
> [@Bill\_Door](#): > > 2008 was a terrible year for me. Between January 1, 2008 and January 1 2009 my retirement account lost 32.7% of its value, and that’s with me shoveling money in with both hands, actually money in excess of the tax free maximum so I had to put in after tax dollars. 2009, now that was a good year, up 50% in 2009 and 25% in 2010, so not too bad overall. Jack Bogle says it’s not timing the market, it’s time in the market. I feel for people who lost jobs and thus had to dip into savings. I don’t feel for people who had jobs but who panicked and sold at the bottom. Dan Ariely on Marketplace said the best strategy was to not open your monthly report. Worked for me. ---
**Author:** ![Emerald\_Hawk](https://avatars.discourse-cdn.com/v4/letter/e/e495f1/32.png) [@Emerald\_Hawk](https://boards.straightdope.com/u/Emerald_Hawk)\ **Post date:** [December 24, 2014, 11:36pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758/65 "2014-12-24T23:36:43Z")
Medicaid / Medicare will be in trouble, but I wouldn’t call what could happen to Social Security an “economic catastrophe”. Social Security can be fixed essentially “forever” (as far in to the future as we can predict with any accuracy) by either cutting benefits by 25% or removing the income cap on contributions. Removing the income cap, in particular, is [fairly popular](http://act.boldprogressives.org/survey/post_election_polling_next/?source=2014polling.com) with the American public, although obviously that depends on how the question is phrased. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [December 25, 2014, 1:23pm UTC](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758/66 "2014-12-25T13:23:37Z")
> [@Voyager](#): > > I feel for people who lost jobs and thus had to dip into savings. I don’t feel for people who had jobs but who panicked and sold at the bottom. > Dan Ariely on Marketplace said the best strategy was to not open your monthly report. Worked for me. The people I felt badly for were those who were compelled to sell at the bottom by the required minimum distribution policies. I understand the intent of a retirement account is not to have tax sheltered money pass from generation to generation, but think there should be some amount of money not subject to the RMD rules, maybe the first $250,000 or so. I know the retirement account tax law is already badly skewed in favor of wealthy donors, witness [Mitt’s $100,000,000 IRA](http://www.reuters.com/article/2012/01/24/us-usa-campaign-romney-ira-idUSTRE80N04E20120124), but I hate to force people to sell at the bottom. [Previous page](https://boards.straightdope.com/t/economics-of-retiring-baby-boomers/707758.md?page=3)